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Byrne was born in Balmain, a suburb of Sydney, New South Wales, and is of Irish and Scottish descent.[6][7] She is the daughter of Jane, a primary school administrator, and Robin Byrne, a semi-retired statistician and market researcher.[8] She is the youngest of their four children; she has an older brother, George, and two older sisters, Alice and Lucy. In a 2009 interview, Byrne stated that her mother is an atheist, while both she and her father are agnostics.[9]

Byrne worked again with fellow Australians Wan and Whannell for the sequel Insidious: Chapter 2, which was released on Friday, 13 September 2013, and again also featured actors Patrick Wilson and Lin Shaye.[30] The film received mixed reviews from critics[31] and became the biggest opening day in US box office history for the month of September following its release.[32]Insidious: Chapter 2 was a financial success, grossing over US$160 million against a budget of US$5 million.[33]

In 2014, Byrne starred in the comedy film Neighbors, alongside Seth Rogen and Zac Efron. The film received positive reviews and went on to become a box office success.[34][35] A remake of the 1982 classic, Annie, featured Byrne playing the role of Grace Farrell, Mr. Stacks' colleague. Byrne's performance was mostly praised with reviewers calling her the surprise highlight of the movie. In 2015, Byrne co-starred with Melissa McCarthy, Jude Law and Jason Statham in the hit comedic action tale Spy,[36] and in 2016, she reprised her role as Moira MacTaggert in X-Men: Apocalypse.[37]

Byrne has supported UNICEF Australia by being the face of the 2007 Designers United campaign and a member of Tropfest jury in 2006 and Tropfest@Tribeca[39] in 2007. She is a graduate and ambassador for NIDA's (National Institute of Dramatic Art) Young Actors Studio.[40]
In 2014, Byrne became the face of Oroton, the Australian producer of luxury fashion accessories.[41]

Byrne was in a relationship with Australian writer, director and actor Brendan Cowell for over six years. Cowell moved from Sydney to New York City, following Byrne's success on Damages. The relationship ended in January 2010.[42]

In 2012, Byrne began dating American actor Bobby Cannavale. The couple have two sons together.[43] In February 2016, she gave birth to their son, Rocco.[44] She and Cannavale had their second child together, son Rafa, in November 2017.[45]

As of 2013, Byrne lived in New York and said she remains insecure about a stable career: "I don't think that insecurity ever leaves you. You're a freelancer. There's always an element of uncertainty."[4]